How to Pay for Long Term Senior Living Care

When deciding which senior living community is right for you or a loved one, all the different factors to consider can become exhausting. But there is one consideration that stands out and affects us all – how do you pay for it? The average cost of assisted living in America is $4,500 per month and the average cost of memory care in the United States is $6,160 per month, both following a steady pattern of growth over the years. Unfortunately, of Americans aged 60 and older, 80% do not have the financial resources to cover long-term care services. This can often lead to older adults going without the care they need due to the financial strain it would cause. Remember Me Senior Care created a guide that gives you practical ways to cover care costs.

Understanding Different Price Structures

Depending on the community, you will find that there are different pricing structures throughout senior living. This can also lead to unexpected fees or an increase in cost due to a change in care. When transitioning into senior living, consistency can make all the difference in your care journey. Here are common price structures in comparison to our locked-in, all-inclusive pricing.

Level of Care Fees

Some pricing structures base monthly payments on the level of care a resident requires, which can cause fluctuations in cost. As care needs increase, the cost of living may rise, and this is also the case when transitioning from assisted living to memory care. This type of pricing can create uncertainty for residents, making it difficult to budget for both short- and long-term care. Life can change unexpectedly, and your needs or those of your loved ones may shift in an instant. The last thing you want is uncertainty about how much future care will cost.

A La Carte

A La Carte pricing, similar to other care-based structures, creates a fluctuating monthly cost depending on the services you need or request. Typically, this is in addition to a baseline cost for essential care, with optional services like housekeeping, meal plans, and transportation added on. While this model gives residents more control over which services to include, it can place additional stress on those managing finances. Deciding which services to prioritize in order to stay within a monthly budget can lead to difficult choices and unwanted conflict over necessary expenses.

Our Locked-In Pricing

What sets Remember Me Senior Care apart from other pricing structures is our locked-in, all-inclusive rate for residents. This approach ensures that residents know exactly what they will be paying throughout their stay in our community, providing financial predictability and peace of mind. By eliminating the uncertainty and fluctuating costs found in other pricing models, we help reduce the unnecessary stress often associated with managing care expenses, allowing residents and their families to focus on what truly matters: quality of life and care.

Know Your Financial Options

With our locked-in rates, you can now begin to determine how you’ll consistently pay your monthly expenses. Although it may feel like you are on your own when it comes to affording care, there are multiple financial options available to potential and current residents. With these options, affordable care is more accessible. 

Long-Term Care Insurance

Another proactive way to help individuals afford care is by creating a long-term care insurancee (LTC) policy. These policies are designed specifically to cover the costs associated with long-term care services, which are often not covered by standard health insurance or Medicare. By paying into an LTC policy over time, beneficiaries can accumulate resources that will help pay for care when they need it most. Once the policy is activated, it can provide a daily or monthly benefit, which can be used to cover a wide range of care options, including assisted living, memory care, home health services, and nursing home care.

For seniors and their families, this can offer a significant financial safety net. LTC insurance can help bridge the gap between personal savings and the high cost of care, ensuring that residents receive the services they need without exhausting their resources. This also reduces the likelihood of seniors needing to rely on family members for financial support or facing the difficult choice of forgoing care due to cost.

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Life Insurance Policies and Other Financial Assets

Life insurance policies with a cash value can be a valuable asset for residents transitioning into long-term care. Unlike term life insurance, policies with a cash value—such as whole life or universal life insurance—can be cashed out or borrowed against, providing immediate funds that can be repurposed to help cover the costs of long-term care. This flexibility can make these policies an important financial resource for those who need care but may not have access to liquid assets.

In addition to life insurance policies, other financial accounts, such as Individual Retirement Accounts (IRAs) and Certificates of Deposit (CDs), can also be repurposed to help pay for care. These accounts, often set aside for retirement or savings, can provide much-needed liquidity when transitioning to a senior living community. Accessing these funds can help residents alleviate the financial strain of care costs, reducing the reliance on out-of-pocket savings or monthly income.

When considering a senior living community, it's wise to speak with a financial advisor to explore how existing financial assets, like life insurance policies, IRAs, and CDs, can be optimized. Advisors can help residents determine the most strategic way to convert these assets into funds for care.

Federal and State Benefits

For some Americans, federal benefits are available to help pay for senior housing, offering critical financial support for those who may struggle to afford care. Certain programs are specifically designed to help veterans and their spouses. For example, the Department of Veterans Affairs (VA) offers the Aid and Attendance benefit, which provides additional monetary assistance to Veterans and their spouses who require help with daily living activities. At RMSC, we are proud to waive our move-in fees for Veterans.

In addition to Veteran-specific benefits, other federal and state programs can help cover the cost of senior housing and care. Since state-level benefits can vary significantly, it's beneficial to take the time to explore local programs and resources that could make care more affordable. By taking advantage of these opportunities, seniors can reduce their out-of-pocket expenses and ensure they have access to the care they need without depleting their financial resources.

Financial Planning Today

One of the most critical aspects of affording senior living is proactive financial planning. Long-term care is a significant financial commitment, and without careful preparation, it can quickly overwhelm both seniors and their families. Ensuring that you have a comprehensive financial plan in place is essential. By planning early, individuals can take advantage of multiple financial tools and resources to ease the burden of care costs later in life. This not only protects personal assets but also helps to avoid unexpected financial strain when transitioning to a senior living community. Proactive financial planning can help you maximize your savings, reduce out-of-pocket expenses, and ensure you have access to the quality care you need. Take our short survey to learn how senior living fits into your current budget.

Navigating the costs of long-term senior living care can feel overwhelming, but with proactive financial planning and a clear understanding of your options, you can obtain quality care without exhausting your resources. From exploring long-term care insurance to leveraging life insurance policies, federal benefits, and other financial assets, there are numerous ways to make senior living more affordable. Ready to start planning? Contact us today to learn more about how RMSC can be your next home.